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Mr. Bob Lutz sure is having a grand time with his latest gig writing opinion pieces for Road & Track. Last time, he took aim at Tesla, saying the electric automaker was “doomed.” This time, he has taken aim at Volkswagen, and offers up his explanation as to why a scandal of this scale was able to occur.

According to Lutz, it all boils down to one man: Ferdinand Piëch. Piëch was the former chief of Volkswagen’s supervisory board and, when digesting Lutz’s brief backstory on his encounter with him, it’s easy to see why the man became so powerful and influential.

Lutz continues on to call Piëch’s leadership a “reign of terror,” penning the following:

I imagine that at some point, the VW engineering team said to Piëch, “We don’t know how to pass the emissions test with the hardware we have.” The reply, in that culture, most likely was, “You will pass! I demand it! Or I’ll find someone who can do it!”

In these situations, your choice was immediate dismissal or find a way to pass the test and pay the consequences later. Human nature being what it is—if it’s lose your job today for sure or lose your job maybe a year from now, we always pick maybe a year from now.

It’s a theory many other have kicked around in the industry, pointing blame at the engineers, but with a “we had no choice” attitude attached.

With news of Porsche’s 3.0-liter diesel engine now being flagged by the United States EPA, the damage control train doesn’t seem to be stopping any time soon.

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2 Comments

Bob Lutz is completely right about the inefficiency of this dictatorial kind of management.

But — assuming Lutz’ description being correct — Piëch is certainly not the only manager to rule this way. Every engineer or programmer or designer will have experienced this “you do as I told you” or “I want to see this or that result, and I don’t care how you achieve it. That is your job! Or else…”

BTW, GM had one of those, the infamous José Ignacio López de Arriortúa, the big cost cutter, who did his damage mainly by forcing third party suppliers to deliver with lower prices, thus creating the eponymous “Lopez Effekt” designating the use of cheapo and often defective parts to save money in production, which results in huge repair costs and defective cars later. Lopez started his carreer at GM’s spanish factories, advanced to Opel Rüsselsheim, and in 1992 was made Executive Vice President for world wide purchases in Detroit.

VW’s Piëch later enticed Lopez with seven of his “warriors” to leave GM for VW, thus schlepping the Lopez-Effect to VW. GM raised a big hue and cry for disclosing of commercial secrets, but should rather have been happy to get rid of this man whose main effect was to lower the quality of Opel cars and thus causing loss of market share.

Unfortunately, there is no article on José Ignacio López de Arriortúa in the english language Wikipedia, only in German, Spanish and Cataln.

Every commercial company is a dictatorship, even if the brutality of the dictatorship varies. Every employee is at the mercy of her or his boss, and lives under the permanent threat of losing the basis of one’s livelyhood.